The government is to abolish Sats for 14-year-olds in a historic move triggered by the collapse of this year's marking process and a string of high-profile critical reports on the tests.

The changes mean pupils will no longer have to sit externally marked tests at the age of 14, but ministers have insisted that primary school pupils will still have to undergo the most controversial tests at 11.

The schools secretary, Ed Balls, today informed parliament of plans for sweeping changes to the national testing system, which sees 1.2 million pupils sit 9.5m papers every year.

The move cuts the testing burden on schools in half.

The plans also include a new American-style "report card" for every school so that parents can access information about schools they might want to send their child to. Every school will receive a grade depending on their performance.

Balls said: "If you ask, are we abolishing half the national testing system, yes, we are."

"These reforms will provide more regular and more comprehensive information to parents about their children's progress, support heads and teachers to make sure that every child can succeed, and strengthen their ability to hold all schools to account, as well as the public's ability to hold government to account."

He said that the changes followed an "ongoing debate" about the value of the tests but admitted this summer's crisis had been a factor in the timing. The government is urgently seeking a replacement for ETS, the company which failed to deliver this year's tests on time.

Balls denied it was a U-turn, insisting they were simply responding to mounting evidence that the tests are not useful for schools.

The changes announced today include:

• An end to national tests for 14-year-olds and the league tables based on those test results;

• A new school–by-school report card to give parents richer information when they are choosing schools. These will still provide data for league tables;

• A review group will be established to oversee the reforms and they have been charged with looking at the impact of tests on 11-year-olds to tackle charges of teaching to the test.

Although first introduced in their current form in 1995 under the Conservative government, the tests have been a defining feature of Labour's education reforms.

It comes after a disastrous year when the delivery of the tests collapsed under the American firm, ETS, which had been brought in to modernise the system. The £156m contract with ETS was dissolved, and some schools are still awaiting results.

The testing system has also been severely criticised by MPs in a select committee report, which said tests had "distorted" children's education.

A major inquiry into primary education by Cambridge University also found that Sats were feeding into a "pervasive anxiety" in children's lives.

The move will be widely welcomed by secondary schools and teacher unions but others representing primary schools will be dismayed.